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Study On The Two-Sided Markets Platform Pricing Strategy

Posted on:2009-06-30Degree:MasterType:Thesis
Country:ChinaCandidate:N CengFull Text:PDF
GTID:2189360272974157Subject:Technical Economics and Management
Abstract/Summary:PDF Full Text Request
Two-sided market is a new issue rising in the theory of Industrial Organization. The different products face with different customers in two-sided markets, the interactions between the two-sided markets give rise to strong complementarities, but the corresponding externalities are not able to be internalized by end users. To this two markets, the platform firms in two-sided markets must choose not only a price level but also a befitting price structure considering interests of both sides, in order to make its profit maximal.This whole text research is standing at the side of platform. At first some basic theory in two-sided markets are looked back. Mainly including its definition characteristics and its grouping. To its definition, we point out it is tightly contacted with network externalities and price structure non- neutrality; to its characteristics, we explain the difference between two-sided markets and traditional markets (or single market ) is that the externalities can't be internalized by end users; to its grouping, we according to the different industry to group them. Second, this text start with the theory origin of platform pricing, show this pricing theory are related with multi-product pricing and network externalities, and based with different industry analyze some pricing mode, and then, mostly discuss pricing research actuality form customers'behaviors to platform behaviors, following point out their deficiency, illuminate the existing literatures having researched the multi-homing and single-homing behaviors, platform pricing promise and so on, then based on the existing literatures, point out their deficiency, following write some basic theory of this text's research.In the model segment, first considering two oligarch competitive platforms with the static state, analyze the pricing strategy and the compatibility choices when the end-users single-homing and multi-homing, proving when satisfying the conditions, the single-homing behavior makes the platforms have excessive motivation to choose compatibility; when the end-users are single-homing, their pricing demand elasticity decline. In succession, based on the single-homing model, following consider a two period equilibrium with switching costs, through a two period competition model, mainly research the change between this two period when there is the switching costs, find when the platform have larger market 1 share in the first period, in the second period the platform are more likely to price high to the market 2 end-users; when platforms face with the fulfilled customers, the platform price higher to the market one end-users and price lower to the market two end-users than they face with the non-fulfilled customers; when all the market one end-users choose newly in the second period, the switching costs make platform worse in the first period.
Keywords/Search Tags:Two-Side Markets, Platform Competition, Externalities, Multihoming, Switching Costs
PDF Full Text Request
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